$1 Bid Wins Government Open Source Software Purchasing Experiment (gsa.gov)

An anonymous reader writes: A couple weeks ago we discussed a project from a software team within the U.S. General Services Administration. Its goal was to set up a portal to let developers bid on the creation of open source code needed by the government. From the beginning, they said it was an experiment, and now the results are in from their first project. The project was quickly bid all the way down to $1, and on Wednesday, the winner delivered a functional solution that met their criteria. They say, "When we received the $1 bid, we immediately tried to figure out whether it was intentional, whether it was from a properly registered company, and whether we could award $1. We contacted the bidder and we confirmed that the bid was valid, that the registration on SAM.gov was current, and that the bid would be the winning bid. It was a plot twist that no one here at 18F expected. This unexpected development will no doubt force us to rethink some of our assumptions about the reverse-auction model." Despite their surprise, the team feels this is proof that the system can succeed. They're now working to refine the process.

Comments

Re:Work for free!!

[fragMasterFlash]

If it builds your reputation then you will likely have additional customers looking to hire you at much more reasonable rates.

Works until all have ruined themselves

[gweihir]

And then, when all competent contenders are out of the picture, prices raise and quality drops. This is _not_ a problem where a capitalist competitive approach is a good idea, as this is not about standardized products that a lot of people can produce.

Re:Work for free!!

[Anonymous Coward]

The first 5 years, every cofounder of the company had a day job and helped build the company for free on night and weekends as well as we gave our service away for 5 years as well. It paid off for us.

Building a business by offering a free service tier is really very unlike a custom labour contract where the compensation is $1.

Likewise, many artists, painters, caterers, wedding planners, photographers, barbers, massage therapists,

A genuine massage therapist is not going to build a portfolio from offering "free massages", bro. They're going to get trained somewhere and they're going to either work in that place or somewhere similar. Ditto for barbers. Painters and photographers get fucked on a regular basis by endless offers of EXPOSURE - if you're doing a job somewhere prestigious enough that it'll wow whoever is reading your work history, they can afford to pay. If they say "for exposure!", it's because they know some idiot is going to add a huge amount of value to their product in return for zero - and if you offer, you're reducing pay across the market, and end up fucking yourself.

Now if you're starting out and offering to do a bit of work for a local charity or whatever, or you're getting some sort of active training, you might charge close to zero. If you're displaying your work in some sort of marketplace or cooperative, you might even be contributing to costs. Competitions? Great. But if a commercial enterprise wants to pay someone ZERO for simply doing some work, consider the quality of applicant you're competing against and the worth of experience (the example here is a gimmick because someone did something for the first time that caught attention).

and even lawyers built their portfolio first by doing work if not for free or pro bono

In England&Wales, the typical first step if you're not top tier is to spend endless years working as a paralegal, hoping and praying to secure that training contract, before realising that - like a model on the "casting couch" - your employer might not quite have been telling the truth about making you a star. There is something very wrong if, having fully qualified, you are thinking about building a pro bono portfolio - you really ought to be working at the firm that trained you, or somewhere similar. You might get shit pay, but you'll get pay.

then at least below what they would later like to charge.

Yes, juniors have less experience and command lower rates than experienced people who can do a better job... of that there's little doubt.

Re:Work for free!!

[Kjella]

'Free' may not quite mean free.
It means you can now advertise this in your resume, for example.

Sure but is it a race to the bottom? I mean the whole point is to offer something for cheap now to cash in later, lots of things are about that like oh every sale in existence. But it doesn't work if people are jumping in all the time thinking they'll be the next big thing, the next time you're making a "real" bid the next guy offers $1 and so it goes on and on. I mean $1 isn't ten minutes at minimum wage, it's way below any kind of living wage even eating Ramen noodles and living in your parent's basement. I have a friend who does music on a semi-professional basis, and yeah you can almost always get a free-ish band doing it for the exposure. And they've had to man up and say if that's what you want that's fine but it won't be our band. They've practiced many, many hours both alone and together and want to see some kind of pay-off but they're constantly in competition with bands that think this is their lottery ticket to stardom and will sell themselves very cheap. Like he commented on a local festival, he'd like to play for the local community but it'd have to be almost for free and the other bands don't get play time anywhere else and it would tarnish their reputation. The price tag is mostly about perception, a big name is worth a big price and then you can't act small.

Re: Work for free!!

[Half-pint HAL]

This is exactly what free market means. This isn't a problem.

What I've never understood about those who declare that anything that arises from a free market is good is this: why isn't unionisation considered a market force? Why is it OK for large businesses to consolidate to wield ever greater power, but workers are told that acting collectively is "interfering in the market"?